Key facts
- Intel forecasts Q3 revenue of $15.8 billion to $16.8 billion, exceeding analyst estimates.
- The company expects Q3 adjusted profit of 38 cents per share, above the 27 cents estimated by analysts.
- Second-quarter revenue increased 25.4% to $16.13 billion, with adjusted profit at 42 cents per share.
- Demand for Intel's server CPUs is surging due to the AI boom and agentic AI applications.
- Intel raised its capital expenditure forecast for the year to $20 billion and expects further increases next year.
- Intel secured Tesla as a customer for its next-generation 14A process.
Intel has forecast quarterly profit and revenue above analyst estimates, driven by robust demand for its server central processing unit (CPU) chips as the artificial intelligence boom spurs a buildout of computing infrastructure. The company anticipates third-quarter revenue to be between $15.8 billion and $16.8 billion, surpassing the average analyst estimate of $15.10 billion. Adjusted profit is expected to be 38 cents per share, exceeding the analyst estimate of 27 cents.
This surge in demand is attributed to the growth of agentic AI, where autonomous agents perform tasks like computer coding. Intel's second-quarter results showed a 25.4% increase in sales to $16.13 billion and an adjusted profit of 42 cents per share, beating estimates. The company's adjusted gross margin also came in higher than expected at 41.8%.
In response to the strong demand, Intel has raised its capital expenditure forecast for the year to $20 billion and anticipates further increases next year. Chief Financial Officer David Zinsner indicated that Intel has secured long-term agreements with customers for data center CPUs and specialized chips, providing confidence in future output planning. Intel also announced Tesla as a customer for its next-generation 14A process for the 'Terafab' AI chip project.
Meanwhile, Texas Instruments also forecast its third-quarter revenue to be between $5.65 billion and $6.15 billion, exceeding analysts' average estimate of $5.61 billion, signaling a potential recovery in industrial chip demand and growing momentum for its AI data center chips.